"Govt. measures not part of clear strategy," warns analyst

The govt.’s measures were brought on by circumstance and weren't the result of a clear strategy, while a budget review can be expected soon, says a top analyst. Speaking to B92, Vladimir Gligorov from the Institute for International Economic Research said that it was very unlikely that the government would go through with measures pertaining to scaling down public administration personnel numbers. "Govt. measures not part of clear strategy," warns analyst “The fall in inflation is good on the one hand because you’re not paying as much as before. On the other hand, the state will have problems financing public spending, which is when those who depend on state money will find themselves in a situation where they can no longer pay off their debts,“ Gligorov explained. He said that paying off debts to the state was difficult enough as it is, and that it would only get worse now. “Then you need a review once again, which will lead to further cuts in public spending and negative repercussions for employment and spending,“ Gligorov warned. MoF: New measures to cut red tape The government’s new measures will lead not only to a reduction in personnel, but to improved, more effective state bureaucracy, says the Finance Ministry. Speaking to B92, Ministry State Secretary Slobodan Ilic explained that the government was embarking on serious reforms in public administration that are due to be implemented during the course of the year. He said that more scope for cutbacks remained, in terms of expenses that ministers decided on independently—so-called discretionary expenses. “For the very reason that it’s well-known that discretionary expenses in the budget were very high, they came to around 150 billion (EUR 1.6bn), the government has urged savings in that field too and, in that context, these 40 billion (EUR 428mn) that we’re talking about are actually savings on those discretionary expenses, and we believe that if the need arises those discretionary expenses can be even lower,“ said Ilic. According to the state secretary, the government is preparing a plan to raise solvency in the economy through multilateral compensation, or debt consolidation, while measures for converting company debts into state capital are due to be adopted by the end of April. He said that the state had “serious debt“ towards companies, though he would not divulge the actual figure. “The state owes a lot—I wouldn’t like to quote any figures—but the state’s debt is big in that context. But I should point out that the Serbian Roads public company, as one of the most important companies in the public sector, will receive a total of 20 billion (EUR 214mn),“ said Ilic. “That’s something that the government has opted for right now, which will lead to solvency being pumped into the economy, in a market-based manner. And that will unquestionably help reduce reciprocal debts in our economy,“ the state secretary explained.

"Govt. measures not part of clear strategy," warns analyst

“The fall in inflation is good on the one hand because you’re not paying as much as before. On the other hand, the state will have problems financing public spending, which is when those who depend on state money will find themselves in a situation where they can no longer pay off their debts,“ Gligorov explained.

He said that paying off debts to the state was difficult enough as it is, and that it would only get worse now.

“Then you need a review once again, which will lead to further cuts in public spending and negative repercussions for employment and spending,“ Gligorov warned.

MoF: New measures to cut red tape

The government’s new measures will lead not only to a reduction in personnel, but to improved, more effective state bureaucracy, says the Finance Ministry.

Speaking to B92, Ministry State Secretary Slobodan Ilić explained that the government was embarking on serious reforms in public administration that are due to be implemented during the course of the year.

He said that more scope for cutbacks remained, in terms of expenses that ministers decided on independently—so-called discretionary expenses.

“For the very reason that it’s well-known that discretionary expenses in the budget were very high, they came to around 150 billion (EUR 1.6bn), the government has urged savings in that field too and, in that context, these 40 billion (EUR 428mn) that we’re talking about are actually savings on those discretionary expenses, and we believe that if the need arises those discretionary expenses can be even lower,“ said Ilić.

According to the state secretary, the government is preparing a plan to raise solvency in the economy through multilateral compensation, or debt consolidation, while measures for converting company debts into state capital are due to be adopted by the end of April.

He said that the state had “serious debt“ towards companies, though he would not divulge the actual figure.

“The state owes a lot—I wouldn’t like to quote any figures—but the state’s debt is big in that context. But I should point out that the Serbian Roads public company, as one of the most important companies in the public sector, will receive a total of 20 billion (EUR 214mn),“ said Ilić.

“That’s something that the government has opted for right now, which will lead to solvency being pumped into the economy, in a market-based manner. And that will unquestionably help reduce reciprocal debts in our economy,“ the state secretary explained.